BILL NUMBER:  SB 592
  VETOED	DATE: 09/27/1999




Sacramento, CA

September 27, 1999

To the Members of the Senate:

I am returning Senate Bill 592 without my signature.

This bill would require cities that submit a request for possessory
interest property tax reimbursement for revenue losses resulting from
Chapter 959, Statutes of 1995, to be reimbursed from the General
fund.  Chapter 959, in part, dealt with the distribution of satellite
wagering handle to cities and counties.

I am vetoing this bill because it would appropriate approximately
$175,000 from the General Fund to reimburse eligible cities for their
fee-revenue loss.  These costs to the General fund are not reflected
in the 1999 budget Act.

In addition, this bill would grant ongoing fiscal relief not usually
provided and would create a precedent for similar General Fund
backfill for other entities.  Specifically, SB 592 appears premised
on the position that the state reimburses local agencies for property
tax revenue losses when possessory interest tax exemptions are
provided.  However, that analogy should not be used because
possessory interest exemptions typically are made with specific
provisions not to reimburse local agencies  for those losses.
Therefore, the effect of this bill would be to have the state
reimburse a local agency for a reduction in fee revenue.

Sincerely,





GRAY DAVIS